The dangers of Pakistan’s coal revival

Due to a crippling electricity shortage, Pakistan is all set to expand power generation through coal, but renewables may be a better option

Maha Wasim, The Third Pole

Last December, delegates from over 150 countries gathered at the UN Climate Summit in Paris to conclude an agreement on climate with the goal of limiting the rise of global temperatures below 2⁰ C. However, while the rest of the world is clamping down on coal, Pakistan is attempting to revive its fledgling coal industry with five new power plants scheduled to start producing electricity by 2018 and many more in the pipeline. These coal power plants will spew billions of tonnes of carbon dioxide into the atmosphere over their lifetime further jeopardizing the future of our planet.

According to Khalid Mansoor, CEO of Hub Power Company, the problem lies in the country’s electricity generation fuel mix which is heavily tipped towards imported oil. Because coal is absent from the fuel mix, he says, the average cost of power generation is very high.

The coal conundrum

Pakistan has the world’s seventh largest reserves of lignite, yet less than 0.1% of its energy is generated from coal. Since the World Bank and other multilateral financial institutions have turned their back on coal, China has become Pakistan’s partner of choice for investment, construction and operation of these new coal-fired power plants. The China-Pakistan Economic Corridor (CPEC) is a bilateral deal between the two countries under which the Chinese government and banks will financially support Chinese companies to build USD 45.6 billion worth of energy and infrastructure projects in Pakistan over the next six years. The power plants will initially run on imported coal and will later transition to locally mined coal.

Despite the fact that Pakistan has experienced the negative impacts of climate change in the recent past, a lack of awareness among citizens, misguided energy and environmental policy and a desperate need for energy make it likely that the coal projects will proceed as planned. Moreover, in a country where almost half the population teeters on the brink of the poverty line, environmental concerns are placed rather low on the priority list. Ghulam Rasool, a resident of Muzaffargarh who was displaced by the floods of 2010 sums up the country’s collective apathy to the climate change issue, “Whether we die of poverty [because of lack of energy] or are carried away by the floods [caused by a changing climate], it is the same to us.”

An alternative strategy

A multi-dimensional approach is required to tackle Pakistan’s energy crisis while being mindful of the disastrous impacts of fossil-fuel related greenhouse gas emissions. Short-term measures could include upgrading aging power stations to become more energy-efficient, minimising transmission and distribution losses through smart metering and improved system monitoring, as well as introducing demand management initiatives such as peak pricing to curtail peak demand. In the long-term, Pakistan should aim to transition away from imported fossil fuels and focus on developing indigenous resources to meet its growing energy needs.

The off-grid population could also benefit from the opportunity to ‘leapfrog’ directly to renewables via distributed generation without having to wait for central grid extension. Small-scale systems using localised fuel sources such as biomass and animal waste could be used to generate power. Solar cell technology could also be used to power microgrids in off-grid communities. Not only would this be cheaper than extending the centralised grid to remote locations but transmission and distribution losses resulting from transporting power over long distances would also be reduced.

Across Asia and Africa, private entrepreneurs are using mobile phones to top-up credit at smart electricity metres located in poor and remote communities The metres cut off power when the credit runs out. These pay-as-you-go systems enable the poorest communities to purchase electricity on an as-needed basis, and the certainty of payment encourages private investors. Pakistan has already experienced the mobile revolution and facilities like mobile money transfers and phone banking are used by a significant portion of the population. These existing facilities could be extended to pay for distributed energy services across the country.

To stimulate private sector investment, the government should provide financial incentives and streamline the approval process to expedite project implementation. Nation-wide government-led initiatives to convert gas water heaters and diesel water pumps to solar would also accelerate the uptake of renewable technology and contribute to savings in the energy bill. The cost of renewable energy is declining worldwide and Pakistan must use this opportunity to develop its vast indigenous renewable energy resource base to power a green economy.